Unexpected events can take a lasting toll on your financial security. While you can't predict what experiences you will encounter in life, there are steps you can take to prepare for the unexpected. A job loss or an expensive car payment will be much more manageable if you've created a financial security net to fall back on. There are three key areas to consider when planning for the unexpected: emergency funds, insurance and your overall budget.

Emergency Fund
We all know that it's important to save, but it can be difficult to know how much should be dedicated to paying unexpected expenses. Typically, an emergency fund consists of enough to cover three to six months of living expenses. Of course, if you have the flexibility to do so, save more than six months' worth. That way, you can cover more payments if the unexpected occurs. If you don't have enough extra cash to create this fund in full, save what you can each month and include your emergency fund in your budget. Learn more about emergency funds.

Insurance
Remember that you aren't necessarily alone when it comes to covering unexpected expenses. With reliable insurance, many of the medical, auto and home-related payments may be covered in part or completely. Disability and life insurance are also worth considering. While having insurance won't eliminate all unexpected expenses, it can make a significant difference if you find yourself in a difficult financial situation. Think ahead and learn more about health, life, auto and homeowners insurance to protect your finances.

Budgeting
Including emergency savings in your budget is the first and most important part of preparing for the unexpected. There are, however, other aspects of budgeting that can contribute to financial security. Maintaining an overall understanding of your budget is not only a good habit to keep, but also helpful in case of an emergency. Being aware of your budget as a whole will help you recognize the difference between needs and wants, prioritize payments and, if necessary, adjust to cover unexpected costs.